U.S. wealth inequality is the highest it has been in nearly four decades, according to federal data, as the economy under the Trump administration appears to increasingly favor the rich.
As of late 2025, the top 1 percent of households held 31.7 percent of wealth, the highest share on record since the Federal Reserve began tracking the figure in 1989.
“Donald Trump talks a lot about the working class, his MAGA base is primarily working class, but if you look at the data, the working class is doing very badly in the second Trump administration,” former Labor Secretary Robert Reich, a professor emeritus at the University of California, Berkeley, told NBC News. “The real growth in the second Trump administration has been in corporate profits and in the wealth of the people at the top.”
The U.S. has become something of a “K-shaped” economy, where those on the upper end of the income scale enjoy greater benefits than the vast majority of those in the middle.
Observers point to a variety of factors to explain the divide, including a stock market that has continued to break records all year, buoyed by hopes about the AI boom, even as the Iran war has thrown global energy markets into chaos and driven up gas prices.
In response to those high gas prices, lower-income Americans cut gas consumption by around 7 percent in March, but still spent 12 percent more due to steeper prices, while the consumption habits of high-income households were essentially unchanged, the Federal Reserve Bank of New York found.
Other macroeconomic indicators showed a similar rich-poor divide.
Overall, unemployment held steady in April and the U.S. added 115,000 jobs, more than expected. However, racial disparities in outcomes persisted, Mohamed El-Erian, a professor at the Wharton School of Business and chief economic adviser at Allianz, told PBS.
”If you look at the details of the jobs report, what we started with, you will see, for example, Black and Hispanic unemployment is getting worse, while Asian and white unemployment are staying as is or getting better,” he said. “Black unemployment is now twice the level of white unemployment. So, within an economy that looks good at the average, we are seeing major divergences that should be of concern.”
The Trump administration has boasted about its economic numbers as part of a broad-based “Golden Age” for all Americans, pointing to an increased average tax refund, reduced inflation, $1,000 “Trump accounts” for new babies, and trillions of dollars the administration says foreign companies have pledged to invest in the U.S.
Its signature tax bill, passed last year, however, delivered benefits disproportionately to the wealthy.
The spending package also cut funding to Medicaid, and Republicans let Affordable Care Act subsidies expire at the end of 2025.
The Independent has contacted the White House for comment.
